09. Nov 18

Bundeskartellamt imposes fines running into millions for illegal arrangements

The Bundeskartallemt, Germany’s Federal Cartel Office, has imposed fines totaling approx. 23 million euros in response to the collective calculation of uniform price recommendations.

According to a case report of the Bundeskartellamt from 16 March 2018, Germany’s Federal Cartel Office imposed fines amounting to about 23 million euros in total on ten businesses and an individual involved in the plumbing and heating services sector in a decision from 21 February 2018 (Az.: B5 – 139/12).

In justifying its decision to impose the fines, the Bundeskartallemt cited that the competing plumbing supplies wholesalers had collectively calculated the respective recommendations for gross list prices as detailed in their sales catalogues using internal data such as operating costs, mobility and minimum discounts. In the course of this, the highest purchase price that a plumbing supplies wholesaler was able to obtain from the manufacturer served as the basis.

The businesses, members of the costing committee for a North-Rhine Westphalia plumbing services association called “Mittelstandskreis Sanitär Nordrhein-Westfalen”, or “MKS NRW” for short, recommended using these gross list prices amongst each other as well as to other members. This frequently led to these prices being either included in the catalogues or only slightly adjusted. The Bundeskartellamt found that the common calculation basis gave rise to an anti-competitive alignment of the initial price level and thus resulted in less competition.

The exceptional derogation for recommendations made by small and medium-sized enterprises was definitively abolished when the 7th amendment to Germany’s Act Against Restraints of Competition, the Gesetz gegen Wettbewerbsbeschränkungen (GWB), entered into force. The members of the MKS NRW would therefore have been obliged to re-assess and cease their anti-competitive conduct. Instead, they continued to collectively calculate the gross list prices until the search in March of 2013. Due to the fact that those involved cooperated with the Bundeskartellamt in uncovering the cartel, they benefited from a leniency programme, which resulted in the fines being reduced.

For those adversely affected by the cartel, the Bundeskartellamt’s decision means that they can demand compensation from the cartelists. We at the commercial law firm GRP Rainer Rechtsanwälte note that it is no longer necessary to furnish evidence substantiating the violation.

We also note that violations of antitrust law or competition law are met with severe penalties, and the violations need not be obvious as in the case of illegal price-fixing arrangements. Lawyers who are experienced in the fields of antitrust law and competition law can advise businesses on enforcing or fending off claims arising from violations of antitrust law or competition law.

For more informations:

https://www.grprainer.com/en/legal-advice/antitrust-law.html

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